Minister identifies official he 'cross-leased' flats with

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New development minister Mak Chai-kwong yesterday named the civil servant with whom he 'cross-leased' properties on adjacent floors of the same building, but denied the arrangement was premeditated.

Following up on his admission on Thursday regarding the matter, Mak told a radio programme that the other civil servant involved was Tsang King-man, the current assistant director of the Highways Department.

Both collected a civil service housing allowance while renting a home owned by the other man, but Mak insisted the arrangement did not break any rules.

'When I was lining up to buy an uncompleted flat [in phase 2 of City Garden in North Point] at that time, I came across Mr Tsang. Both of us wanted to buy flats for investment,' he said after the show. 'We bought flats in the same building for convenience. We had not planned it in advance.'

Tsang could not be reached for comment yesterday.

Land Registry records show Mak and his wife bought flat E, on the 21st floor of Block 9, for HK$925,800 on September 18, 1986.

Two days later, Tsang, along with Pau Wai-ming, bought the flat directly above, on the 22nd floor, for HK$928,000.

Mak said he had been living in another rental flat in phase 1 of City Garden before switching to rent Tsang's flat in the same estate.

With regard to concerns that the two civil servants may have intentionally set rents higher than the market level, Mak said he had rented his flat to Tsang for HK$8,000 a month.

'This was the market value at that time,' he said. 'Maybe some other flats [of similar sizes] were leased for higher rents.' Mak did not reveal the rent Tsang had set nor the government housing allowance he received.

Mak's comments follow an Apple Daily report yesterday revealing that the colleague Mak was referring to could be Tsang.

On Thursday, Mak acknowledged he had leased a flat that he owned to another civil servant for 27 months, from 1986 to 1988, while claiming a government allowance for renting a flat from the same colleague in the same estate.

Speaking on RTHK, Mak, 62, said: 'More than 20 years ago, when I was in my 30s, rental income was a rather stable income source, which could be used to pay my mortgage. This was my consideration.'

Meanwhile, Secretary for Food and Welfare Dr Ko Wing-man, who has been caught up in a row over merging two flats he owns into one without proper permission, has promised to surrender the extra property rates rebate he received for the properties.

Ko admitted he tore down a wall between the two flats he bought in 2003 at One Beacon Hill, Kowloon Tong, without having notified authorities.

The Rating and Valuation Department has been assessing rates for his property as if they were two separate premises, which, in return, allowed Ko to receive two rates rebates instead of one. A Chinese-language newspaper reported yesterday that the amount involved was HK$20,000. However, the department declined to discuss how much extra rebate Ko had received.